SIDE HUSTLESMost passive income in Canada lands on one of two CRA forms. Picking the right one decides which expenses you can claim and whether you owe CPP contributions on that income.
Form T776 — Statement of Real Estate Rentals
Use T776 when you earn money mainly by letting someone use property, with few added services. Renting a driveway, garage, basement suite or storage space usually belongs here. Rental income isn't subject to CPP contributions.
Form T2125 — Statement of Business or Professional Activities
Use T2125 when you're running a business: selling courses, print-on-demand, affiliate sites, YouTube, or a short-term rental where you provide hotel-like services (cleaning, linens, breakfast). Business income is subject to CPP contributions on net self-employment earnings.
Quick guide by hustle
- Parking or storage rental → usually T776
- Long-term room or suite rental → T776
- Airbnb with frequent turnovers and services → often T2125
- Car, trailer or gear rental via an app → usually T2125
- Online courses, POD, affiliate, YouTube → T2125
Platforms now report you to the CRA
Since January 1, 2024, digital platforms operating in Canada must report sellers' income to the CRA. If you earn through Airbnb, Turo, Etsy or similar, assume the CRA already knows the total — report it accurately.
Not sure which applies? The CRA's guides below explain the difference, and a tax professional can confirm your situation.